What is Bitcoin?
Bitcoin is a decentralized, peer-to-peer digital currency system designed to give online users the ability to process transactions via a digital exchange unit known as Bitcoins. In other words, it is a virtual currency.
The Bitcoin System was created in 2009 by an undisclosed programmer (s). Since then, Bitcoin has enjoyed much attention and controversy as an alternative to the US dollar, the euro, and commodity currencies such as gold and silver.
Rise to popularity
Bitcoin did not receive much attention in the business and finance world before 2009. It rose to prominence in 2011-2012 when it gained more than 300%. Bitcoin has seen 400% growth in its value since August of last year. As a result, investors and venture capital firms around the world continue to attach importance to cryptocurrency.
In the first half of 2014, venture capital firms invested $ 57 million in bitcoin in the first quarter, followed by another $ 73 million in the second quarter with a total value of $ 130 million, which is 50% more than last year’s total of $ 88 million. . This is in complete contrast to the scenario in 2012 where Bitcoin companies raised a relatively meager $ 2.2 million.
These statistics prove beyond any doubt that Bitcoin is worth your investment, which begs the question, how can you buy and invest in Bitcoin?
A guide for beginner Bitcoin investors
The easiest and least complicated way to invest in Bitcoin is to buy Bitcoins. There are a lot of well-established companies, especially in the US as well as abroad, that are involved in the business of buying and selling bitcoins, abbreviated as BTC.
If you live in the United States, Coinbase is the place to look. Coinbase provides its clients with BTC at an estimated price of 1% over the current market price. US residents have the option to sync their Coinbase wallets with their bank accounts. As a result, future payment transfers are made hassle-free. This company also gives you the option to automatically purchase Bitcoins from time to time. For example, if you are interested in buying $ 50 Bitcoin at the start of each month, Coinbase allows you to set up an automatic purchase for that amount.
Take note of the terms and conditions before you start using this service. If you subscribe to the automatic bitcoin service, you will not be able to control the price at which BTC is purchased each month. Note that Coinbase does not operate as a Bitcoin exchange, that is, you buy and sell coins directly from the company. Since the company has to obtain coins from other buyers, it may encounter delays or disruptions when placing orders during rapid market movements.
BitStamp fits into the requirements of a traditional bitcoin exchange. Bitcoin acts as an intermediary that allows you to trade with other users and not the company itself. The liquidity here is higher and you always have a good chance of finding someone willing to trade with you. There is an initial fee of 0.5% that can be reduced to 0.2% if you trade $ 150K in a 30-day period.
Alternative ways to buy bitcoins
Exchanging is not the only way to invest in Bitcoins. Local Bitcoins are often used to buy BTC offline. The site is designed to connect potential buyers and sellers. Bitcoins are considered as a treasury of the seller in a guarantee and can only be released to buyers.
Buying Bitcoins offline is not always very reliable or secure. Hence, it is best to meet the sellers during the day and just let a friend peruse with you in case things go south.
Bitcoin isn’t just a recent trend. Venture capital firms consider Bitcoin a suitable alternative to the traditional currency in the long term. There are easy ways to enter the bitcoin investing industry. As mentioned earlier, Coinbase, BitStamp, and Local Bitcoins are the most popular channels for investing in Bitcoin in the United States. Do your homework and discover the path that defines all your boxes.